Uruguay's 2025-2029 National Budget Bill Proposes Strategic Priorities and Fiscal Reform

Strategic Insights -

Economy Minister Gabriel Oddone presented the draft National Budget Law for the 2025-2029 period to the Chamber of Deputies' Budget Committee, outlining the government's strategic priorities, fiscal policy, and tax reform measures. The proposal aims to promote economic growth, reduce poverty and inequality, and strengthen security. The minister emphasized Uruguay's expected growth path, projecting average annual growth of 2.4% for the period, in line with private analysts and international organizations' estimates. The government's priorities include incremental spending on Childhood and Adolescence (40% of increases), Security (15%), Growth to Create and Maintain Quality Jobs (12%), Social Vulnerability (11%), Health (11%), and Others (11%).

Key Takeaways:

  • The National Budget Law for the 2025-2029 period proposes three strategic priorities: Accelerate growth, Strengthen the social protection matrix, and Improve security to strengthen coexistence.
  • Uruguay's economy is expected to continue growing, projecting average annual growth of 2.4% for the period, in line with private analysts and international organizations' estimates.
  • Inflation is aligned with the 4.5% inflation target set by the government.
  • The proposal includes tax modernization and equity measures to localize the payment of taxes in Uruguay and provide greater horizontal equity.
  • The Domestic Minimum Complementary Tax and modifications to the tax treatment for dividends or profits made by Uruguayan companies are part of the tax reform measures.
  • Incremental spending will be included in the budget planning process, with a particular emphasis on Childhood and Adolescence (40% of increases).

Statistics:

  • Uruguay's economy is expected to grow at an average annual rate of 2.4% for the 2025-2029 period.
  • Inflation is aligned with the 4.5% inflation target set by the government.
  • 40% of incremental spending will be allocated to Childhood and Adolescence.
  • The remaining items in the budget planning process will be divided as follows: Security (15%), Growth to Create and Maintain Quality Jobs (12%), Social Vulnerability (11%), Health (11%), and Others (11%).

Sources:

  • Ministry of Economy and Finance (Uruguay)

https://www.gub.uy/ministerio-economia-finanzas/